Many businesses take notice of how much they’re spending on their energy bills, but as energy prices stay consistently in the headlines, a rising number are also thinking about fundamental questions like how much they use, and where that energy comes from.
A recent survey for British Gas showed that one in four small businesses would like to cut their fixed costs, and 63% wanted to hear more about how to save energy. For larger corporate companies and the public sector, challenging carbon reduction targets and the need to remain competitive are driving this agenda forward.
However, for many businesses reducing energy consumption can seem like a challenging and time-consuming effort, when the reality is quite different. There are many low or no cost actions businesses can make to reduce energy that can make a noticeable difference to monthly bills. And many investments into energy saving technology actually pay back that investment within a few years.
Making sustainable energy choices makes business sense
British Gas recently advised the owner of a hair salon in Lincolnshire who was using an old storage heating system and fans to heat and cool his premises. But having upgraded to a new outdoor air source heat pump, the owner is looking forward to reduced heating bills of up to 70% with a payback period of between three and five years.
Larger businesses are also negotiating multi-year energy efficiency contracts that reduce their energy costs, consumption and carbon emissions. Many public sector organisations including hospitals have taken up an Energy Performance Contract, a self-funding agreement designed to reduce energy consumption and costs. A range of energy efficiency measures, from lighting, new boilers and cooling systems to solar panels and ground source heat pumps, are installed and maintained, often giving the ability to generate renewable energy on site. The measures then pay for themselves through reduced energy use over an agreed period of time.
LED lighting is also seeing a surge in interest, in particular from the public sector, retailers and manufacturing companies. Energy savings from 50% to 70% are not unusual compared with conventional technologies, and result in similar cuts to carbon emissions.
Arguably the biggest barrier to energy efficiency for some is their rental arrangement. A Department of Energy and Climate Change study in 2010 found that 60% of SMEs rented from commercial landlords, and a recent Citizens Advice survey that 17% don’t actually have direct responsibility for their own bills. New proposed energy efficiency standards for privately rented commercial properties will help, but small businesses should consider what is in their control and work with the landlord to find mutually beneficial savings. Making even a few small changes to the way your business uses energy can make a big difference to your energy bills over the course of a year.